Green under MPs’ fire again over BHS pensions

Sir Philip Green, former head of the collapsed retailer BHS, has come under fire for "prioritising loyal senior managers" over ordinary staff in the £363 million rescue deal agreed for the company pension fund last month.

Green's rescue package, secured on February 28, brought to an end months of recriminations over the bankruptcy of the high-street retailer, including a lengthy investigation by MPs on Parliament's Work and Pensions Select Committee, at which Green appeared and was questioned.

Frank Field, the MP who chairs the committee, wrote to the government's Pensions Regulator in early March interrogating the rescue deal in more detail. In particular, he asked how many BHS staff would benefit from the removal of a £37,400 cap on pensions that is usually imposed by the Pension Protection Fund - the authority that bails out collapsed schemes.

February's deal meant the BHS fund avoided the PPF, in order to provide members with higher payouts. Among them, Field has discovered, were 16 of the firm's highest-paid directors who will now be due pensions worth more than the cap.

In a statement today, March 21, Field said: "It is clear that Sir Philip prioritised his loyal senior managers, who have had the PPF cap on high pension benefits completely removed. That measure was designed to encourage those in positions of influence to urge prudence and responsibility; I would be worried if TPR was content to see it jettisoned as a matter of course.

"Those who do far less well out of the settlement are the ordinary staff of working age, many of whom lost will have lost their jobs as well."

A spokesman for Green declined to comment.

The BHS Pension Scheme's total membership is around 19,000. In total and on average, they are due to get 88% of the pensions they would have got under the old scheme, in contrast to 69% under the PPF.

Field said he hoped that Sir Philip would voluntarily choose to pay back a £15 million refund that he may be due from the deal in certain circumstances. This was set aside in February to cover extra expenses for the new BHS pension arrangements, if more of the scheme's current membership choose the new deal than is expected.

Field said: "I hope Sir Philip will recycle any refund back into the scheme as BHS pensioners will still be facing cuts in the benefits for which they paid."

A spokesman for the Pensions Regulator said the aim of the agreement it had reached with Green had been to deliver "as strong a deal as was possible" for all members, no matter what their income.